(Reuters) - A U.S. judge decided on Tuesday that victims of the Sept. 11, 2001, attacks are not entitled to seize $3.5 billion of assets belonging to Afghanistan's central bank to satisfy court judgments they obtained against the Taliban.
U.S. District Judge George Daniels in Manhattan said he was "constitutionally restrained" from finding that the Taliban was Afghanistan's legitimate government, a precursor for attaching assets belonging to Da Afghanistan Bank, or DAB.
Daniels said letting victims seize those assets would amount to a ruling that the Taliban are Afghanistan's legitimate government.
He said U.S. courts lack power to reach that conclusion, noting that Biden administration does not recognize the Taliban as Afghanistan's government.
"The judgment creditors are entitled to collect on their default judgments and be made whole for the worst terrorist attack in our nation's history, but they cannot do so with the funds of the central bank of Afghanistan," Daniels wrote.
"The Taliban - not the former Islamic Republic of Afghanistan or the Afghan people - must pay for the Taliban's liability in the 9/11 attacks," he added.
Daniels' decision is a defeat for four groups of judgment creditors that claimed some of the $7 billion of DAB funds that had been frozen at the Federal Reserve Bank in New York.
"This decision deprives over 10,000 members of the 9/11 community of their right to collect compensation from the Taliban," said Lee Wolosky, a lawyer for one creditor group known as the Havlish plaintiffs. "We believe it is wrongly decided and will appeal."
The other creditor groups are also planning an appeal, a separate Tuesday court filing shows.
In an executive order last February, U.S. President Joe Biden ordered $3.5 billion of the DAB funds set aside to benefit the Afghan people.
Last September, the U.S. Treasury said it would move that money to a Swiss-based trust beyond the Taliban's reach.